U.S. SEC charges crypto trader for ‘orchestrating’ attack on Mango Markets

• The SEC has charged Avraham Eisenberg for manipulating the price of the Mango Markets token
• The crypto trader has also been charged by the CFTC and Department of Justice for his role in rendering the crypto platform insolvent

The United States Securities and Exchanges Commission (SEC) has joined other federal agencies in charging Avraham Eisenberg – a crypto trader. The crypto trader has come under the scrutiny of the regulators for his activity on Mango Markets, a decentralized crypto exchange. In a blog post released today, the SEC accused Eisenberg of “orchestrating an attack” on the trading platform. The attack was executed by manipulating the platform’s native token – MNGO token.

Trader attacks Mango Markets with its native token

The SEC has accused him of stealing nearly $116 million worth of cryptocurrencies by manipulating the price of MNGO tokens on the futures market. It also stated that the trader’s actions resulted in all the assets being drained from Mango Markets, rendering it insolvent.

The press release states,

“used an account that he controlled on Mango Markets to sell a large amount of perpetual futures for MNGO tokens and used a separate account on Mango Markets to purchase those same perpetual futures (…) engaged in a series of large purchases of the thinly traded MNGO token for the purpose of artificially raising the price of MNGO token”

The trader, however, proposed negotiation with the Mango Market DAO after the attack. Eisenberg had agreed to return a partial amount, i.e., $67 million, with him gaining full control over the rest of the money. Following this, the trader tried to execute a similar attack on Aave – a decentralized lending platform. However, the plan went bust, resulting in him losing millions

In addition, the commission is investigating whether Eisenberg violated other securities laws. The crypto trader is currently detained in Puerto Rico and would be taken to the Southern District of New York soon. The case is set to be heard by United States Magistrate Judge Judy Katherine Parker.

Other federal agencies take action against Mango Markets attacker

Notably, the commission is not the first agency to take an action against the crypto trader. The Department of Justice and the Commodities Futures Trading Commission (CFTC) have pressed civil and criminal charges against Eisenberg. The CFTC has charged him with commodities fraud and commodities manipulation. The CFTC filing read,

“The Commission seeks civil monetary penalties and remedial ancillary relief, including, but not limited to, trading bans, restitution, disgorgement, rescission, pre- and post-judgment interest, and such other relief”